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Technical Standards and Safety Authority 2013-14 A

nnual Report Our Stories in Safety

2013-14

Annual ReportTechnical Standards and Safety Authority

OuR STORieS in SAfeTy

Technical Standards and Safety Authority 3300 Bloor Street West

14th floor, Centre TowerToronto, Ontario Canada M8X 2X4

Tel: 416-734-3300fax: 416-231-1626

Toll free: 1-877-682-8772 (TSSA)e-mail: [email protected]

www.tssa.org

TeChniCAl STAndARdS And SAfeTy AuThORiTy

2013-14

AnnuAl RepoRt

The True Value of TSSa’S SafeTy SySTem

To keep Ontarians safe, every day, we enforce regulations, codes and standards through engineering design reviews, inspections,

investigations, and examination, certification and licensing activities. To make Ontarians aware of how to lead safer lives, we

inform and educate owners, users, manufacturers, operators, and the public on better safety practices. We explain why rules

and regulations exist, and how Ontarians can make every day decisions that result in safer activities.

Our value proposition is to emphasize prevention, and to identify gaps in compliance by applying best safety policies

and practices.

We all share a desire to make Ontario safer. We all play a part in the safety system. Together, through informed decisions, greater

awareness, and a keen sense of responsibility, we will continue to pursue positive safety outcomes in the province of Ontario.

TSSA’s true value rests in our relentless pursuit of making Ontario a safer place, every day.

Elevating and Amusement Devices

Boilers and Pressure Vessels

Upholstered and Stuffed Articles

Operating Engineers

Fuels

Contents

Messages from TSSA 5

A Message from the Chair 7

A Message from the President and CEO 9

A Year in Review 11

Management’s Discussion and Analysis 41

Fiscal Year 2014/2015 Outlook 50

Independent Auditors’ Report 53

Financial Statements 54

Notes to Financial Statements 58

Corporate Information 63

Company Balanced Scorecard for Fiscal Year 2013/2014 69

to promote and enforCe publiC safety...

Created in 1996 by the Government of Ontario as an

administrative authority, we enforce public safety laws

throughout Ontario under the Technical Standards

and Safety Act, 2000 (the Act) in designated sectors,

such as amusement devices, boilers and pressure

vessels, elevating devices, fuels, power plants, ski lifts,

and upholstered and stuffed articles. The Ministry of

Consumer Services (MCS) sets public safety standards

and policy, including authority for the Act, and oversees

TSSA’s delivery and performance.

TSSA delivers a broad range of safety services, including public

education and consumer information, certification, licensing

and registration, engineering design reviews, inspections,

investigations, safety management consultation, and

enforcement and prosecution activities. With a team of over

400 safety professionals, approximately 75% of whom work in

operations, we are passionate about the care entrusted to us

as one of Ontario’s public safety regulators.

We work with partners in industry, government and the public,

striving for zero serious injuries and fatalities in all of our

regulated sectors. With our risk-informed approach, gaining

national and international interest, we’re truly measuring risk

and focusing our expertise to where it matters most – the

safety of every Ontarian.

It’s all about coming together – with knowledge, vigilance,

and a shared focus. That’s the strength behind the men and

women of TSSA, progressing toward our vision: to be a valued

advocate and recognized authority in public safety.

See where the story took us this year…

To promote and

enforce public safety.

SAFEty – Be safety conscious at all times

LEADErShiP – Be the best in actions and words

intEgrity – Be honest and ethical

rESPEct – Build trust and earn respect

AccOUntABiLity – Be responsible for all actions and deliver on commitments

cOmmUnicAtiOn – Be an effective and efficient communicator, and an active listener

tEAmwOrk – Work together, respect individuals and celebrate success

To be a valued advocate and

recognized authority in

public safety.

TSSA’s values are a reflection

of our commitment to public

safety, and the beneficiaries of

all our efforts are our public and

industry stakeholders.

PUrPOSE ViSiOn VALUES

mESSAgES FrOm tSSA

“Safety is at our core. From its expression

within our values and the stories that we

share…we walk-the-walk as much as

we talk-the-talk, every single day.”

a message from the Chair

Leading the Board of Directors of Ontario’s public safety

regulator is both an honour and a privilege, not only

because of the safety-driven accomplishments of the

dedicated men and women of this organization, but also

being part of the effort to keep Ontario one of the safest

jurisdictions in the world.

A commitment to safety is often unseen although it involves

noble efforts behind the scenes to ensure our well-being and

quality of life. At TSSA, our staff of safety professionals and

the Board of Directors are the quiet strength of public safety,

working to keep us all safe and maintain a vigilant watch over

the province.

The past year was full of many notable accomplishments

and changes and I commend my colleagues on the Board

for continuing to provide effective strategic direction and

oversight to the organization. Our governance work has

ensured that TSSA continues to contribute to achieving even

greater levels of safety in Ontario and remains focused on its

vision of being a recognized authority in public safety and a

valued public safety advocate.

The Board was energized this past year with the appointment

of a slate of new directors representing both industry and the

public sector. The balance of experience and new perspectives

has animated the Board’s deliberations, diversifying points

of view and introducing new insights into public safety,

organizational excellence and governance best practice.

The Board’s critical role in providing strategic oversight

supported a number of important developments undertaken by

the organization’s senior management team, including among

others: the creation of a new Chief Audit Executive role; the

appointment of an employee and industry Ombudsman; and

the formation of an Innovation Committee. These initiatives

will further enhance the organization’s governance, customer

service, transparency, efficiency and accountability to the

industries it regulates, to the Government of Ontario to which it

reports and, most importantly, to the public of Ontario.

The Chief Audit Executive is an internal auditor position that

operates independently and objectively. The role provides an

assurance function for the organization, reporting directly to the

Board and its Audit, Finance and Risk Committee. Designed to

significantly enhance the effectiveness of risk management,

internal controls and good governance, this function will help

the Board and TSSA maintain greater financial controls and

transparency, and better identify potential risks to business and

strategic initiatives.

The Office of the Ombudsman will help TSSA achieve even

higher standards of governance, customer service and

transparency. The role provides an independent and confidential

means for both staff and industry players to engage TSSA with

issues and concerns, as well as suggestions to enhance both

public safety and service delivery.

The establishment of a cross-functional internal Innovation

Committee will spur the organization’s embrace of the future

by looking at how to incorporate emerging technologies and

apply innovative approaches to our operations. By adopting

innovative thinking, we are looking to increase productivity,

improve customer service and enhance organizational efficiency,

ultimately allowing TSSA to better serve the public and enhance

safety outcomes.

These initiatives speak to the Board’s deep commitment to

strengthen governance, accountability, transparency and

customer service at TSSA. Achieving excellence in safety

outcomes requires a committed and professional staff,

excellence in executive leadership, strong partnerships with

government, consumer and industry partners, and strategic

Board oversight, all working together cohesively and

collaboratively in pursuit of the single goal of ensuring Ontario

remains a leading jurisdiction in public safety. This year’s

accomplishments have strengthened the organization and

measurably enhanced public safety in Ontario and have set the

ground for even greater achievements next year.

I am deeply appreciative and thankful for the considerable

commitment and dedication of my Board colleagues, the men

and women of TSSA, and the stakeholders of Ontario.

Judith Wolfson

Chair, Board of Directors

A commitment to safety is often unseen although it involves

the noble efforts behind the scenes to ensure our well-being

and quality of life. At TSSA, we are the quiet strength of safety and maintain a vigilant watch over the province.

a message from the president and Ceo

It never ceases to amaze me when I think about all the

areas of modern life that TSSA’s exceptional team of

safety professionals touch day-after-day. At home, work

or play, we are there ensuring your safety. Whether it

is the boiler at your local school, the elevator in your

building, or the roller coaster at your favourite park, we

take our responsibility for safety very seriously. Safety is

easy to take for granted, in part because we have been

very successful in making Ontario exceptionally safe in

the sectors we regulate, and in part because safety

is intangible.

That is why in my first year as President and CEO of TSSA, I

placed an added emphasis on safety, to ingrain it more deeply

into our workplace culture and to make it more visible. From

its inclusion in our corporate values to the daily stories about

safety that we share at our team meetings, the men and

women of TSSA now walk-the-walk as much as they talk-the-

talk every single day. I am enormously proud of the staff at

TSSA and admire their commitment and passion to public safety.

This year’s Annual Report highlights a few of the many special

individuals behind the organization’s notable achievements in

safety in order to put a face on those successes.

Mitigating risk is at the core of what we do at TSSA and how

we work to keep the people of Ontario safe. In addition to

inspections and engineering reviews, we mitigate risk through

an innovative approach to risk analysis and behaviour insight

that seeks to methodically identify and analyse risks, and

devise strategies to get people to engage in safer behaviour.

Two of the stories in this year’s Annual Report highlight the

accomplishments in this critical aspect of our work, including

a Canadian patent on our Risk-Informed Decision-Making

Framework, which follows the US Patent that was awarded

the previous year, and an Ontario Fire Marshal’s Award for

Excellence in Fire Safety for our work in carbon monoxide safety.

A more familiar aspect of what we do is enforcement, which

is typically associated with the work of our inspectors. A lesser

known, but equally important, dimension of our enforcement

work are the prosecutions carried out jointly by our legal and

investigations team. This little known law enforcement function

puts more bite into our safety work. This year, we undertook a

number of prosecutions and sent a loud and clear message to

those worst offenders that Ontario’s public safety regulations

will be enforced to the fullest extent of the law.

As a public safety regulator, one of our most important

obligations beyond our core safety mandate is to engage with

our regulated customers, industry, and in particular the broader

Ontario public. This year, we stepped up our engagement

and communication efforts beyond the daily touch points

between our frontline staff in inspections, engineering and

licensing, registration and certification to be more accountable

and transparent to those we serve through social media. We

launched a number of truly innovative content strategies,

including launching a web-based interview program called

‘Safety Matters’ and a feature called ‘Ask TSSA’ on our safety

blog ‘The Exchange’.

At TSSA, we believe safety is a shared responsibility between

the public, industry, the government and, of course, the safety

regulator. While the public and industry components may be

obvious, the role of government in safety is less known and

appreciated, but vital. This year, we made enormous gains

in our work with our government partners in the Ministry

of Consumer Services, including: developing proposed

amendments to the propane regulations to implement the

remaining recommendations of the Propane Safety Review

Panel and reduce administrative burden on business; and,

reviewing the Boilers and Pressure Vessels regulation to

enhance compliance in the sector.

This past year’s accomplishments are a testament to the

exceptional men and women of TSSA who work tirelessly

to ensure safety in the sectors we regulate. In the spirit of

continuous improvement, we recognize that there are many

opportunities still ahead of us to achieve even greater safety

for Ontarians. As always, we welcome your feedback on how

effectively we meet our commitments and how we may

improve our services. We look forward to another year of

safety enhancements with your support.

Michael Beard

President and Chief Executive Officer

At home, work or play, we are there ensuring your safety.

Whether it is the boiler at your local school, the elevator in

your building, or the roller coaster at your favourite park,

we take our responsibility for safety very seriously.

Sarah Simons ED/AD Engineer

A yEAr in rEViEw

This year, we’ve chosen to highlight the work

of eight members of TSSA’s staff and their

safety-driven stories. Their work behind the

scenes makes us safer every day.

Sandra Cooke tSSA Ombudsman

Greg Kerr communications Advisor

Stu Seaton Fuels investigator

Dave Lisle Director, research and Education

Lency Mulamootil Decision Analysis Advisor

Raj Bharati Legal counsel

Rene Karavas ED/AD regional Supervisor

Sarah Simons AD Engineer

Technical Standards and Safety Authority – Annual Report 2013-1413 14

our year in safety

At TSSA, we believe safety is a shared responsibility. That is why we focus on bringing together the expertise of our

many partners to cultivate and strengthen Ontario’s safety system. Power and gas utilities, petroleum companies,

Ministry policy analysts, professional engineers, elevator technicians, firefighters, piping contractors, building owners,

welders, boiler manufacturers, amusement ride mechanics, consumers, and many others all play an important part in

keeping Ontario’s safety net strong.

In this year’s Annual Report, we profile some of the individuals

at TSSA who work behind the scenes facilitating and supporting

the partnerships that make Ontario one of the safest

jurisdictions in the world. Day in and day out, the men and

women of TSSA conduct field inspections, review engineering

designs, participate in code committees, conduct risk analysis,

educate the public about safety risks, and research and analyze

policies to do their part in keeping the sectors of the economy

we regulate safe. Their accomplishments speak to both a deep

passion and abiding commitment to public safety. We are proud

of their work and pleased to highlight some of the ways they

contribute to making TSSA a more effective safety organization

and Ontario a safer place to live, work and play. Introducing

some of the men and women of TSSA who work to make

Ontario a better and safer place …

■■ Sandra Cooke, who was appointed TSSA’s first Ombudsman;

■■ Communications Advisor Greg Kerr, who played a key role

in the rollout of our Social Media strategy, and Amusement

Devices Engineer Sarah Simons, who used social media to get

the word out about new zipline regulations;

■■ Elevating Devices Regional Supervisor Rene Karavas and

Decision Analysis Advisor Lency Mulamootil, whose work

applying risk analysis to safety decisions has improved

the way TSSA inspectors issue orders and the way TSSA

schedules inspections;

■■ Investigator Stu Seaton and Legal Counsel Raj Bharati, who

are part of the TSSA prosecutions team that has launched a

record number of prosecutions; and

■■ Research and Education Director David Lisle, who leads TSSA’s

innovative carbon monoxide awareness strategy.

This year, we conducted over 13,000 engineering design

reviews, over 50,000 inspections, issued more than 139,000

safety orders, and launched 46 legal cases to prosecute both

individuals and corporations that violated safety regulations.

These activities resulted in increased compliance with safety

regulations, deterred illegal activities that endangered the

public, reduced safety risks in our regulated sectors, and

increased the overall effectiveness of Ontario’s public safety net.

Our staff does far more than enforce; we inform, educate, and listen.


Engineering Designs

Reviewed13,000 +

REVIEWED

Additional achievements include:

■■ maintained a zero backlog in our periodic inspections;

■■ completed a review of the Propane Regulations;

■■ launched an initiative in partnership with the Ministry of

Consumer Services to enhance compliance in the Boilers and

Pressure Vessels sector;

■■ made significant upgrades to our data system;

■■ introduced an online training system;

■■ generated positive financial results;

■■ received another patent for our Risk-Informed

Decision-Making framework;

■■ reduced public safety risks in Amusement Devices by 27%,

Escalators by 60%, Ski Lifts by 67%, and Fuels by 80%

compared to last year; and

■■ increased trend in compliance for Propane of 69%.

We continually measure how we are progressing as an

organization and how we are contributing to public safety in the

sectors we regulate. TSSA’s balanced scorecard, found on pages

69 to 72 of this report, provides detailed information about how

well we did as an organization in achieving our goals for the

past year. For more detail on the state of compliance as well

as measures and trends in the safety of our regulated sectors,

the Annual Public Safety Performance Report, which is available

on our website, provides both detailed analysis as well as

highlights for all of our safety programs.

Safety, after all, is a shared responsibility and TSSA brings together the expertise of many partners to cultivate and strengthen our system.

WE ISSUED OVER

139,000SAFETY ORDERS

50,000+INSPECTIONS CONDUCTED

in 2013-14, public safety risks reduced by:

fuels

amusement devices

escalators

ski lifts

27%

80%

67%

60%

cEASE AnD DESiStTSSA’s Legal and Investigation Teams at Work

When TSSA Fuels Investigator Stu Seaton received a tip that an uncertified fuels contractor was working on gas appliances at a local

fast food restaurant in Hawkesbury, located halfway between Ottawa and Montréal, he immediately set out to investigate.

When he got to the Dairy Queen where the suspected fuels contractor was installing a new gas fryer and grill, he was deeply

concerned about the risk the gas appliances posed not only to the young staff that work at the restaurant, but the many customers

who line up every day for burgers and ice cream. And, when Stu dug deeper and found that the contractor had been conducting all

the gas work in the building where the Dairy Queen was located, he became alarmed at the risk posed to all the building occupants.

Stu’s investigation revealed that the fuels contractor had received a previous cease-and-desist order for working on fuel appliances

without a TSSA Certificate. It was clear the contractor, who was operating in Prescott County, was at it again. The contractor’s

actions, compared to other responsible business owners, were potentially callous and could have put the public at risk from

carbon monoxide poisoning, which can easily sicken and kill those exposed to the deadly gas. It was time to bring in TSSA’s

prosecution team to send a stronger message to deter such reckless behaviour.

Raj Bharati, TSSA’s Legal Counsel, began to build a case for prosecution. Working with Stu’s investigation file, Raj obtained a court

summons for the contractor to appear in court to face charges under the Technical Standards and Safety Act, 2000.

Stu’s court testimony led to a successful prosecution. The contractor was found guilty of installing and servicing gas appliances

without holding a TSSA Certificate, failing to register with TSSA as a fuels contractor and failing to comply with a TSSA safety order.

The Ontario Court of Justice in Hawkesbury levied a fine of $5,000 plus the mandatory 25% victim surcharge and imposed a

12-month probation order. The next time the contractor is caught working on a gas appliance, he could possibly face jail time.

TSSA’s Investigators like Stu and Legal Counsel like Raj took on a record number of prosecutions this past year. Their dogged work

investigating incidents and making compelling arguments in court play a critical role in enforcing Ontario’s public safety laws

and ultimately keeping all of us safe from unscrupulous operators who fail to follow safety regulations and put the public, and

themselves, at risk.

Stu Seaton Raj Bharati Legal Counsel Fuels Investigator

TSSA’s Investigators like Stu and Legal Counsel like Raj

took on a record number of prosecutions this past year...keeping us all safe.


The work of TSSA’s inspectors and engineers in the Boilers and Pressure Vessels (BPV) Safety Program allows the

plants that power the province to keep the lights on and ensures the systems that heat and cool our hospitals, schools

and office buildings keep us cosy all year-round.

Our job is to ensure every boiler, pressure vessel and piping

system in Ontario is compliant with the province’s safety

regulations. We do this by conducting engineering reviews,

manufacturing inspections, first inspections, and periodic

inspections of uninsured BPVs. We also certify all BPV inspectors

in Ontario, including those employed by insurance companies

that carry out periodic inspections of insured boilers and

pressure vessels.

This year, we conducted over 15,500 inspections and over 5,000

engineering design reviews to ensure the continued safety of

boilers and pressure vessels in Ontario. Additional activities

from the year include:

■■ issued 111 orders related to non-compliances with

safety regulations;

■■ conducted a safety analysis and reviewed the frequency

of internal inspections of BPVs;

■■ conducted a safety analysis of new snow-making machinery

operating at higher pressure levels;

■■ continued to provide authorized inspection services to the

Darlington, Pickering and Bruce nuclear power plants;

■■ continued to provide engineering and inspection services

to ensure road safety during the transportation of

dangerous goods;

■■ continued to provide technical training and expertise to

standard setting committees of the Canadian Standards

Association; and

■■ initiated a review of the BPV Regulation, in partnership with

the Ministry of Consumer Services, to enhance compliance.

The overall results of our efforts contributed to maintaining an

extremely high level of safety in the BPV sector. The compliance

rate for uninsured BPVs was 97% and there were no reportable

incidents in the BPV sector, making Ontario’s BPV sector one of

the safest in North America.

We are committed to continuing technical training through representation and membership in groups such as the nuclear design work group, The National Board of Boilers and Pressure Vessel Inspectors and ASME Certification.

5,000+NUMBER OF ENGINEERING

REVIEWS CONDUCTED

15,500+ INSPECTIONS CONDUCTED 111

ORDERS OF NON-COMPLIANCE

ISSUED

BOiLErS AnD PrESSUrE VESSELS


Our inspectors conduct inspections

on over 2,900 power plants to

make certain that they are

registered and operating safely. X 100

OPErAting EnginEErS

At TSSA, we make sure power plants – from a little curling rink with an automated refrigeration plant to a large-scale

thermal generation power plant – follow the province’s safety rules so they operate reliably and safely. We also certify

12,700 power engineers and operators to ensure the people running Ontario’s power plants have the right skills

and training to run everything safely and smoothly. Our inspectors conduct inspections on over 2,900 power plants

registered across the province to make certain that they are operating safely.

This year, TSSA’s Operating Engineer (OE) Inspectors conducted

over 2,800 inspections to ensure Ontario’s power plants operate

at the highest levels of public safety. Additional activities from

the year include:

■■ issued over 4,900 orders to approximately 1,600 plants

related to non-compliances, and registered 108 new plants;

■■ successfully prosecuted a Burlington refrigeration operator

caught with a forged certificate; and

■■ produced a recruiting video in conjunction with the Institute

of Power Engineers to encourage Operating Engineer as a

career choice to address the looming skills shortage in

the industry.

Overall, public safety risks in the OE sector remain

extremely low, with no fatalities or injuries recorded in

the last seven years.

An impending skills shortage in Power Engineering prompted tSSA to develop a recruiting video, which has

received tremendous support across the industry.

We examine and certify power engineers and

operators to ensure everything runs safely throughout the province.

IN 2013-2014, POWER ENGINEERS CONDUCTED OVER

2,800INSPECTIONS

WE CERTIFY OVER

12,700 POWER ENGINEERS

WE REGISTERED

108 NEW PLANTS

PiOnEErS in SAFEty EDUcAtiOn Getting the Word Out on Carbon Monoxide Safety

Dave Lisle and his Public Education and Research team focus on getting people to do the safe thing. This is not as

easy as it sounds because changing behaviour requires changing the way people think and act.

When it comes to carbon monoxide safety, the challenge is that much greater because carbon monoxide (CO) is not

something that most people are aware of, let alone actively protect themselves against.

CO remains a leading cause of accidental poisoning in Ontario, across Canada, and in many countries around

the world. The most prominent cause of CO incidents are related to malfunctioning fuel-burning equipment and

appliances, poor venting, and using such equipment in confined spaces.

Getting fuel-burning equipment and appliances regularly maintained and/or inspected by a TSSA-certified fuel

technician, and installing and regularly testing a carbon monoxide detector are the best ways to protect yourself

against the risk of CO poisoning.

Dave’s team has developed and tested a highly effective strategy to get this message to homeowners in Ontario,

where the vast majority of incidents occur, and more importantly to get them to install CO detectors and arrange for

annual inspections.

Last year, we reached more than 2.8 million homeowners and tenants with a variety of tactics – direct mail, CO Safety

kits, and blitz campaigns – to increase awareness, understanding, and (most importantly) actions to mitigate risk.

After receiving our direct mail, recall rates were five times the industry standard. Of the 1.9 million households,

13.5% recalled receiving the materials. Of those, over 50% felt more or much more informed, and more than 30%

were either somewhat more likely or much more likely to take additional actions to address CO hazards in their

home: two-thirds said they would install a CO alarm and one-third said they would proactively book an inspection for

their fuel-burning appliances. Now that’s research and education at work.

Dave and his team are pioneers in developing and testing new approaches to safety. The Ontario Fire Marshal’s Office

recognized TSSA’s innovative work on CO safety by awarding Dave Lisle a Fire Marshal’s Award for Excellence in Fire

Safety. This is one way we fulfill our vision to become a valued advocate and recognized authority in public safety.

Last year, we reached more than 2.8 million homeowners and tenants to increase awareness, understanding, and (most importantly) actions to mitigate risk.

Dave Lisle Director, Research and Education


Engineering Designs

Rev

iew

ed

over 7,

400

When you ride an elevator, escalator or moving walk, you expect to arrive safely – be it to the office, shopping mall, or

airport. We expect so too.

At TSSA, we regulate the safety of more than 54,000 elevating devices throughout Ontario, including elevators,

escalators, moving walks, lifts for persons with physical disabilities, construction hoists and ski lifts. Over 200

elevator contractors registered with TSSA employ over 4,600 elevator mechanics certified by TSSA. Together, they are

responsible for the safety of the elevating devices they install, alter and maintain.

This year, we conducted over 20,000 inspections and over

7,400 engineering design reviews, ensuring the safety of

elevators, escalators and ski lifts. Additional activities from

the year include:

■■ issued over 76,000 orders related to non-compliances with

safety regulations;

■■ successfully implemented standardized orders and risk-based

scheduling to ensure greater consistency in inspection orders

and the most efficient allocation of inspection resources;

■■ developed a Maintenance Control Program with

cooperation and input from the Canadian Elevator

Contractors Association (CECA);

■■ harmonized safety standards between the American Society

of Mechanical Engineers (ASME) and the Canadian Standards

Association (CSA);

■■ organized an industry town hall for contractors, mechanics,

owners and operators to discuss safety of elevating devices;

■■ enhanced safety enforcement during the labour dispute

between the International Union of Elevator Constructors and

the National Elevator and Escalator Association;

■■ hired seven new elevator inspectors to ensure sufficient

inspection resources to address a growing number of devices;

■■ partnered with the Canadian Ski Instructors Alliance to further

encourage lift and overall ski safety to approximately 40,000

new skiers and snowboarders, including a safety training video;

■■ promoted elevator and escalator safety to over 2,000,000

higher risk riders through outreach to elementary schools,

day cares, retirement homes, and popular primary-age

magazines; and

■■ conducted a risk analysis of levelling issues associated with

single-speed elevators and issued a Director’s Order calling for

a complete retrofit of single-speed elevators.

TSSA’s ED, AD and Ski Lifts Safety program continues to focus its

efforts on reducing public safety risks associated with elevators,

which increased slightly by 4% last year. In the escalator and

ski lifts sectors, the program was highly successful in reducing

public safety risks by 60% and 67%, respectively.

ELEVAting DEVicES

Our public safety education campaign at ski resorts

reached over 40,000 skiers & snowboarders.


Behind the whirling, flipping, gyrating machines at Ontario’s amusement parks, TSSA is working behind the scenes

to make sure your fun times are safe times. We regulate the safety of over 2,000 permitted amusement devices in

Ontario, including roller coasters, Ferris wheels, go-karts, inflatables and waterslides. We license ride operators too who

are, in turn, responsible for the safe set-up, maintenance and operation of all rides.

This year, we conducted over 1,850 inspections and over

290 engineering design reviews to ensure the safety of

amusement devices throughout the province of Ontario.

Additional activities include:


safety regulations;

■■ introduced new zipline safety regulations for campgrounds;

■■ continued to work on harmonized safety standards, including

waterslide standards, between American Society for Testing

and Materials (ASTM) F24 and CSA Z267 Amusement Devices

Safety Code; and

■■ developed a new partnership with the Electrical Safety

Authority for joint seasonal inspections.

A great deal of technical expertise goes into ensuring safety

at amusement parks, but a major factor is the rider. TSSA’s

analysis of amusement ride incidents shows that over 90 per

cent of estimated risk at Ontario’s amusement parks is due to

user behaviour. That is why TSSA’s safety strategy focuses on

public education to teach riders how to be safe. This year, we

ran a pilot Safety Ambassador program at selected water parks

targeting the most at-risk 10-14 year-old riders on-site to teach

safe riding behaviour and reward them for following safety

rules. Based on the successful pilot, the Safety Ambassador

program is being considered for expansion next year. As part

of our ongoing public education work, we also:

■■ conducted public education campaigns at waterslide and go-

kart parks to assist with safe rider behaviour, resulting in over

82,000 direct face-to-face interactions with riders; and

■■ partnered with the Office of the Fire Marshal and the Toronto

Blue Jays to raise safety awareness with young target

audiences, distributing over 150,000 special safety-edition

baseball collector card decks, highlighting various fire, go-kart

and waterslide safety tips to children across the province.

By combining public education and research, engineering

reviews, and on-site inspections, public safety risks in the

Amusement Device sector have been reduced by 27%,

compliance rates have increased to 64%, and incidents

have decreased by 7%.

Public eduction campaigns resulted in

82,000+ FACE-TO-FACE

interactions at go-kart tracks and waterslide parks

WE CONDUCTED

1,850+ INSPECTIONS

AmUSEmEnt DEVicES

in 2013-14, tssa introduced new

zipline safety enhanCements

Sarah Simons Greg Kerr AD Engineer Communications Advisor

inStAnt SAFEty mESSAgingTSSA Gets into Social Media

When Greg Kerr joined TSSA as a Communications Advisor, he never thought he would wind up hosting an online

talk-show. And, when Sarah Simons joined the organization as an Engineer, she never thought she would be a guest

on an interview program. But recently they both found themselves in a small broadcast studio with bright lights

overhead and a green screen behind them talking about new Zipline regulations.

As the host of ‘Safety Matters’, which broadcasts on TSSA’s safety blog ‘The Exchange’, Greg interviews TSSA’s

inspectors, Statutory Directors, technical specialists and other staff like Sarah who can share their expertise on

safety matters.

It is all part of TSSA’s new social media strategy.

Along with Twitter, Facebook and YouTube accounts, The Exchange is part of TSSA’s latest effort to share safety

messages, and offer more information, helpful tips, and technical advice to both regulated customers and the public

using online tools. And, more information equals greater compliance, which all adds up to better public safety.

Social media also allows TSSA’s audience to engage more directly. The ‘Ask TSSA’ feature currently available on The

Exchange highlights TSSA technical experts who answer commonly asked questions. If you have a technical or safety

question, post it on the blog. One of our TSSA technical experts will provide an answer.

TSSA’s regulated customers and the public asked the organization to get social, be more interactive and responsive,

and communicate more broadly. The Exchange is how it listened.

Along with Twitter, Facebook and YouTube,

The Exchange is part of TSSA’s effort to share safety messages, and offer more information, helpful tips and technical advice.


FUELS

We rely on fuels like natural gas and gasoline for so much: heat for our homes, fuel for our vehicles, to cook our food,

run our power plants, power our tools and for endless other uses to provide the comforts of modern living. It has some

inherent risks, but when used smartly and safely, fuels provide us with many of our basic needs.

At TSSA, we oversee the safe transportation, storage, handling

and use of fuels so we can use fuels to power our lives and the

provincial economy safely. We register over 8,700 contractors,

certify over 56,000 tradespeople, and license over 9,100

sites, ensuring fuel suppliers, storage and dispensing facilities,

transport trucks, pipelines, and equipment or appliances that

use fuels are following the safety rules.

This year, we conducted over 12,000 inspections and over 490

engineering design reviews, ensuring the continued safety of

all aspects of fuel usage, transportation, storage and handling

throughout the province. Other activities from the year include:


safety regulations;

■■ permanently eliminated a backlog in periodic inspections;

■■ completed over 2,500 contractor audits;

■■ conducted a review of propane regulation in partnership with

MCS and industry;

■■ conducted industry workshops for contractors on liquid fuels,

fuel oil, and environmental protocols;

■■ partnered with the Ontario Regional Common Ground

Alliance to increase the safety of pipelines and underground

infrastructure, and continued audits of excavation sites in

higher risk areas to gauge compliance and provide safety

awareness information;

■■ delivered effective seasonal safety information, focused

mainly on carbon monoxide and fuel safety, reaching close to

1,900,000 households through major direct mail campaigns

involving TSSA’s AutumnWatch and WinterWise booklets;

■■ conducted a risk analysis of carbon monoxide (CO) risk in

commercial and institutional buildings and launched a special

inspection program; and

■■ conducted over 220 safety presentations to industry as

well as publishing articles in industry magazines to broadly

communicate messages to those who can influence safety

the most.

These activities have contributed to increased public safety in

the Fuels sector. Overall, public safety risk in fuels dispensing

and storage has declined by 80%, compared to the previous

year, and the compliance rate at propane facilities is showing

an increasing trend of 69%. The safety risk associated with CO,

which increased slightly last year by 7% in homes and 5% in

institutional and commercial buildings, remains a concern and

will continue to be the focus of TSSA’s advocacy and public

education programs next year.

This year, we eliminated a backlog in perodic

inspections and enhanced public safety through contractor audits.

We conducted over 12,000

safety inspections to keep people safe

We regulate over

8,700 registered contractors and

56,000 certified tradespeople

Issued over 37,600 orders

related to non-compliance

Created public education

campaigns to reduce carbon monoxide

injury and fatality


UPhOLStErED AnD StUFFED ArticLES

As a consumer, you often do not see the safety behind the things around you. In

fact, when you buy something, you expect safety to be sewn right in. So does TSSA’s

Upholstered and Stuffed Articles (USA) Safety Program. Our aim is to protect the public

from potential hazards found with the use of unclean or unsafe materials, ranging from

bedding, furniture and sports equipment to luggage, handbags, toys and clothing –

basically any article that contains filling material.

With over 12,000 registered licensees,

we seek to ensure their items are properly

labelled with filling materials disclosed to

consumers. In addition to promoting safety,

our aim is to protect the public against fraud

and misrepresentation of upholstered and

stuffed articles, and to provide a level playing

field for the industry. Last year, we conducted

1,100 inspections to ensure retailers,

wholesalers and manufacturers properly label

their products to keep consumers safe. Other

activities from the year include:

■■ issued over 18,700 orders related to

non-compliance with the safety regulations;

■■ enhanced incident reporting with data

analysis, safety performance and metrics to

support future risk-informed decisions;

■■ conducted over 230 information sessions

across Ontario to further educate retailers,

wholesalers and manufacturers on the

safety requirements of the Upholstered and

Stuffed Articles Regulation; and

■■ launched the 3R Project: Reuse, Resale and

Redistribute to address old mattresses and

furniture sold without a second-hand label.

Overall, the Upholstered and Stuffed Articles

sector is showing an increasing trend in non-

compliance, primarily driven by retailers and

wholesalers of second-hand products

not properly labelling their goods. The 3R

Project will target the second-hand goods

sector in order to address the increasing

trend in non-compliance.

Our aim is to protect the public from potential hazards found with unsafe materials.

LiStEning tO cUStOmErS AnD EmPLOyEES TSSA’s Employee and Industry Ombudsman

If you wanted a trusted source, someone who is knowledgeable about safety regulations, straightforward, and

dedicated to public safety, you would not have to look farther than Sandra Cooke.

A veteran of more than 15 years at TSSA, she has held important positions in Operations, Fuels Safety Engineering,

Business Development, and Compliance, gaining the respect of colleagues within TSSA as well as those in industry.

That is why Sandra was an obvious choice to appoint as TSSA’s first Ombudsman.

The role is much like a confidant or mediator, assisting staff and regulated customers in resolving issues and

developing ideas for improving the way TSSA delivers its services and engages its staff and those whom we regulate.

The response has been overwhelmingly positive. With staff, Sandra fielded a broad range of issues and ideas for

improvement. She facilitated the resolution of conflicts and the implementation of process improvements by working

closely with TSSA’s various departments, brokering discussions and introducing ideas.

The response from industry was equally positive, in part because industry partners were strong advocates of the

position’s creation from the outset.

What can you expect from the Ombudsman? Although Sandra can’t overrule a safety decision made by an inspector

or a Statutory Director, she can help you navigate TSSA and assist you in articulating your issue in the most positive

manner to get the most positive result in a fair and transparent manner.

Modelled on the ethics and standards of practice of the International Ombudsman Association, Sandra is off to a

great start in her new role as TSSA’s first Ombudsman and ensuring TSSA enhances its governance, transparency and

especially customer service.

Sandra can help you navigate TSSA and assist you in articulating your issue in the most positive manner - to get the most positive result in a fair and transparent manner.

Sandra Cooke TSSA Ombudsman


46

PUBLic SAFEty riSk mAnAgEmEnt

TSSA’s innovative Risk-Informed Decision-Making (RIDM) process

supports an evidence-based approach to understanding and

managing public safety risks. The work of TSSA’s Public Safety

and Risk Management (PSRM) group in this area has helped

the organization achieve recognition as a leader in effective risk

management. What makes RIDM truly exciting is its practical

application that allows us to make smarter safety decisions to

keep Ontarians safe.

By quantifying the impact of historical non-compliances and

incidents, including fatalities, injuries and near-misses, PSRM

facilitates the prediction of future safety trends. This past year,

TSSA used RIDM to advance public safety in a number of key

areas, including:

■■ development of risk-based compliance times for specific orders;

■■ conducted a risk analysis of older single-speed elevators,

which resulted in a Director’s Order for those elevators to

be retrofitted;

■■ successfully piloted an automated risk-based inspection

scheduling system;

■■ conducted a risk analysis of carbon monoxide safety in

commercial buildings and institutions and developed a

targeted inspection program;

■■ knowledge-sharing on risk analysis with safety regulators

such as the Electrical Safety Authority, Ontario Ministry of

Labour, the Canadian Food Inspection Agency, Régie du

bâtiment du Québec, and the United States Department of

Transportation (Office of Railway Safety); and

■■ partnered with the National Public Safety Advisory Committee

and the Standards Council of Canada to develop a national

risk standard.

rESEArch AnD EDUcAtiOn

TSSA’s Research and Education team designs, develops, and

directs the implementation of communication strategies and

programs focusing on public education, user behaviour research,

customer communication, and customer research. While TSSA’s

core responsibility is to administer and enforce safety legislation

and regulations, we are committed to achieving positive safety

outcomes through efforts beyond our delegated mandate, such

as public education.

Within a number of regulated industries, risk analysis has

identified user behaviour as a key factor in incidents and

injuries. To address this, TSSA’s Research and Education team

uses public education as a risk mitigation tool by increasing

public awareness of specific risks; helping users better

understand how such risks impact their lives; and ultimately,

working to influence behaviours that help keep Ontario safe.

To do this, TSSA uses a range of approaches to directly

engage target audiences, including safety partnerships, print

publication/direct mail marketing, social marketing, public

relations, and experiential/event marketing. Other activities

from the year include:

■■ conducted customer research to identify, track and

measure value perceptions and further strengthen

customer relationships;

■■ continued TSSA’s approach to modifying user behaviour with

at-risk users in TSSA’s regulated sectors; and

■■ initiated the development of a long-term public safety

advocacy strategy.

EnFOrcEmEnt ActiVity

TSSA has a progressive enforcement policy. In keeping with this

policy, we apply a variety of enforcement options dependent on

the nature of the violation and the past conduct of the offender.

We continue to strive for a high level of compliance by

targeting enforcement resources in conjunction with our risk

management strategy.

Prosecutions are one high-profile enforcement activity we use.

In 2013/2014, we pursued 46 prosecutions. In addition, we use

a variety of other tools including targeted education programs,

legal orders and licence revocation. Our choice of enforcement

action is appropriate for and will escalate with the nature of

the violation.

the call centre answered 82% of

calls within 30 SEcOnDS

nUmBEr OF LEgAL cASES

tackled to prosecute

both individuals and

corporations that violated

safety standards

cUStOmEr cOntAct

TSSA is committed to delivering customer relationship

excellence including the effective handling of customer contacts.

Our customer service approach includes:

■■ encouraging an organizational culture that welcomes

feedback as an opportunity to improve services;

■■ empowering team members to resolve issues on the first

contact; and

■■ conducting analysis on feedback to improve business

processes, communication and service delivery.

Our customer contact centre is the central point of contact for

customers. The centre provides knowledgeable and timely

answers to most common concerns and enquiries.

In fiscal year 2013/2014, TSSA’s customer contact centre

handled over 100,000 phone calls and over 13,000 email

contacts. On average, the centre answered 82 per cent of calls

within 30 seconds.

iSSUES mAnAgEmEnt

At TSSA, we define complaints as an expression of

dissatisfaction with respect to services we provide, actions of

our team members or the complaint process itself. Committed

to continuing to improve customer satisfaction and providing

high standards of service to ensure satisfaction, we address

complaints at the level they are raised. Should the matter

require further attention, the complaint is escalated to more

senior personnel, up to and including statutory directors or the

President and CEO. In fiscal year 2013-2014, we appointed a

new Ombudsman to assist in resolving issues and developing

ideas for improving the way TSSA delivers its services and

engages its staff and those whom we regulate.

FrEnch LAngUAgE SErVicES

Consistent with our French Language Services Policy, we

continue to monitor requests for services in French to determine

the appropriate level of service to meet public safety and

customer service needs.

chiEF SAFEty AnD riSk OFFicEr DAniEL hOOrnwEg

The Chief Safety and Risk Officer (CSRO) position is independent

of TSSA management, reporting directly to the Board.

Responsible for public reports on TSSA’s safety activities, the

CSRO also reports on any safety matters that he, the TSSA Board

or the Minister of Consumer Services requests.

For more information on the CSRO and public reports, please

visit www.chiefsafetyriskofficer.ca.

APPLying riSk AnALySiS tO SAFEty Risk-Informed Decision-Making at Work

As a Regional Supervisor and Trainer in the Elevating and Amusement Devices (ED/AD) Safety Program, Rene Karavas has been

inspecting elevators and training inspectors for over 25 years. One of the challenges he regularly encounters is the subjective nature

of inspections. On the one hand, subjectivity allows inspectors to apply their experience and judgment in assessing issues. On the

other hand, subjectivity can result in inconsistent approaches between different inspectors to the same problem.

Enter Lency Mulamootil, a Decision Analysis Advisor with the Public Safety Risk Management group at TSSA. A critical part of the risk

analysis team at TSSA, Lency has been applying risk analysis to public safety issues for almost a decade.

Together, Rene and Lency worked on a method to develop standardized inspections orders for elevating devices, amusement devices

and ski lifts with a cross-functional team to take some of the subjectivity out of inspections. By quantifying the risks of specific non-

compliances, Rene and Lency, together with a small group of engineers, inspectors and risk analysts, were able to determine the

optimum time allowance for specific inspection orders before those non-compliances posed a public safety risk.

Now, when an inspector issues an order in the ED/AD and Ski Lifts sectors, the amount of time an operator is given to comply with

the order is automatically assigned. This not only enhances efficiency and consistency in our inspections, it allows orders with greater

risks to be resolved quicker. Based on Rene and Lency’s work in the ED/AD and Ski Lifts sectors, standardized orders are being

developed for other TSSA programs.

Based on the success of their work on standardized orders, Rene, Lency and a team of inspectors, analysts and IT professionals are

also working on applying our leading edge risk analysis to the way inspections are scheduled, based on TSSA’s patented approach.

By applying risk analysis to inspections schedules, higher risk devices can be inspected more frequently than lower risk devices,

allowing limited inspection resources to be deployed more efficiently and enhancing public safety. An automated risk-based

scheduling tool was successfully piloted in the Elevating and Amusement Devices and Operating Engineers sectors, and is now being

considered for broader roll-out to TSSA’s other program areas.

Lency Mulamootil Rene Karavas Decision Analysis Advisor ED/AD Regional Supervisor

By applying risk analysis, higher risk devices can be inspected more frequently, allowing

limited resources to be deployed more efficiently and

enhancing public safety.

mAnAgEmEnt’S DiScUSSiOn AnD AnALySiS

“We want to know the impact of our efforts. This year,

we will use our innovative safety metrics to measure

improvements in the reduction of risks and have positive

impacts on public health.”


management disCussion and analysis (md&a)

The Technical Standards and Safety Authority’s (TSSA’s) annual MD&A offers an assessment of the organization’s

results from an operational and financial perspective for the fiscal year ended April 30, 2014. The MD&A is a summary

of actual business and financial performance reflecting the results of an integrated strategic and business-planning

framework and a process followed by senior management each fiscal year.

This MD&A is a key public disclosure document and should be read in conjunction with the audited financial statements

and related notes to the financial statements, which have been approved by the Board of Directors. The accompanying

financial statements, expressed in Canadian dollars, are presented in accordance with Canadian generally accepted

accounting principles (GAAP). It is also important to read this MD&A in conjunction with TSSA’s balanced scorecard

included in this Annual Report to better understand the linkages between strategy, enterprise risk and financial results.

This MD&A necessarily involves some degree of prediction or projection, including forward-looking statements. By

their nature, forward-looking statements require management to make assumptions and are subject to inherent risks

and uncertainties, which give rise to the possibility that predictions, forecasts, projections, expectations or conclusions

will not prove to be fully accurate, that some assumptions may not be correct or that TSSA’s financial performance

objectives, vision and strategic goals may not all be achieved.

cOrPOrAtE OVErViEw

TSSA’s core activities enforce and promote safety regulations,

primarily through its operations in four broad sectors: Boiler

and Pressure Vessels (BPV), Operating Engineers (OE), Elevating

and Amusement Devices (ED/AD), Fuels, and Upholstered and

Stuffed Articles (USA). TSSA’s objectives, activities and outcomes

are captured by way of a balanced scorecard and grouped into

four over-arching strategic safety priorities: Compliance First,

Leverage Risk Knowledge, Shared Responsibility for Safety and

Organizational Effectiveness.

During the fiscal year, TSSA made significant progress in meeting

its objectives, advancing its priorities and making a difference

to everyone in the province of Ontario. The organization made

significant advancements on the majority of its goals, including

positive outcomes as measured by reduced health impacts and

improved regulatory compliance for most sectors. In addition,

some notable accomplishments include:

compliance First

■■ successful elimination of a periodic inspection backlog in

the fuels sector, completion of high/medium risk

inspections in the elevating device sector, and the launch

of a new initiative to ensure timely follow-up inspections

for non-compliances; and

■■ launch of social media to provide new ways to share TSSA’s

expertise and help industry members stay connected and

gain greater compliance with safety regulations.

Leverage risk knowledge

■■ development of an innovative inspection regime utilizing

TSSA’s patented risk-based process (known as Risk-Based

Scheduler 2.0), to provide greater risk analysis and offer

support in the review of propane regulations; and

■■ development of risk-based, time-to-compliance strategies to

ensure consistency and standardization of TSSA enforcement

decisions through inspection activities.

Shared responsibility for Safety

■■ influencing Ontario homeowners/renters to mitigate

carbon monoxide risks with proven approaches in user

behaviour modification;

■■ working with the Ministry of Consumer Services (MCS) and

industry on safety improvements through regulatory reviews

in the BPV sector to enhance regulatory compliance and

within the propane industry to implement risk-informed

inspections; and

■■ launching a corporate social responsibility initiative to

enhance TSSA’s ability to be a valued advocate and

recognized authority in public safety, and further

contribute to the sustainable development, health

and welfare of society.

Organizational Effectiveness

■■ implementation of a new inspection interface to improve

data capture, issuance of standardized orders/directives and

on-site efficiency in ED/AD and OE;

■■ appointment of an internal/external ombudsman to achieve

the highest standard of corporate governance and ethical

behaviour by offering an independent and confidential

means to engage staff and industry;

■■ introduction of a new learning management system

to offer online training to all staff and further foster

continuous learning;

■■ implementation of best practices in project management,

change management, business analysis and process design

to encourage collaboration, standardization and overall

improvement in strategic results;

■■ developing a new independent internal auditor role to

enhance the effectiveness of risk management, internal

controls and governance processes;

■■ embracing TSSA’s safety culture, principles and safe-work

practices across the organization with all employees,

particularly those in field operations, to ensure a safer work

environment; and

■■ branding of TSSA’s commercial fleet to provide a standardized

image/recognition of inspector vehicles.

tEchnOLOgy OVErViEw

The Information Technology (IT) team was instrumental in

supporting the organization as IT continues to evolve as an

enabler of business strategy. The IT team provided technology

leadership to management in meeting TSSA’s safety mandate

through advancements in governance, infrastructure,

applications, and data/information management. Some

notable accomplishments include:

■■ building a simple, stable and secure environment with

enhanced security controls, improved mobile management

technology, and stronger business continuity plans/disaster

recovery capabilities;

■■ streamlining business processes and increasing efficiency

through enhancements to operating systems, reducing data

entry risks; and

■■ enabling technical advancements in risk-based scheduling/

risk profiling and customizing systems to collect and analyze

inspection data and improve overall efficiency.

Of critical importance to TSSA’s vision, safety mandate and daily

operations is effective data management. Strategic use of data

in formulating business strategies, optimizing business

processes and facilitating risk-informed decisions represents

the foundation from which the organization operates, and

remains a strategic asset that TSSA will continue to leverage

with future business initiatives. The IT team has embraced

effective data management principles, undertaken a number

of data enhancement initiatives and is taking a leadership

role in ensuring that data is used effectively with all future

business initiatives.

A recent initiative of long-term significance is the Enterprise

Information Architecture program. This initiative, in the initial

planning stage, will establish and maintain a sustainable

foundation for further aligning IT with business strategy,

operational excellence and information/data assets.


riSk-inFOrmED DEciSiOn-mAking OVErViEw

Risk-Informed Decision-Making (RIDM) is the science of

proactively understanding and managing public safety risks

by effectively administering safety through the regulatory

framework in the Technical Standards and Safety Act, 2000

and its associated regulations. This unique approach, led by

TSSA’s Public Safety Risk Management (PSRM) team, is gaining

recognition and helping TSSA achieve its goal to have its safety

metrics recognized by Canadian regulators as the benchmark to

effectively manage risk. TSSA has developed and patented its

knowledge in effective public safety risk management through

its RIDM model.

By quantifying the impact of historical non-compliances and

incidents, including fatalities, injuries and near-misses, RIDM

facilitates the prediction of future safety trends using a metric

known as Fatality Equivalents. Working with each program area,

TSSA aims to achieve Fatality Equivalents that are less than, or

equal to, internationally recognized standards.

During the fiscal year, PSRM engaged in a number of important

risk initiatives, including:

■■ providing insight and analysis of safety risks associated with

technological obsolescence of devices and assisting TSSA’s

statutory directors in effectively managing risks through

Directors Orders;

■■ significantly enhancing TSSA’s safety and compliance

performance reporting methods through the introduction

of the innovative Fatality Equivalent metric;

■■ providing advice and guidance to other safety regulators on

developing risk models and processes including the Régie du

bâtiment du Québec (RBQ), Ontario Ministry of Labour, and

the Canadian Food Inspection Agency;

■■ assisting the organization in understanding, updating and

indexing of pertinent risk data as part of a broader enterprise

data governance initiative; and,

■■ publishing an article in a recognized scientific journal on health

impacts to large populations using a risk-based approach.

EntErPriSE riSk mAnAgEmEnt OVErViEw

Supporting TSSA’s core purpose and vision, Enterprise Risk

Management (ERM), forms an integral part of management and

of the strategic, business and internal audit planning cycles. The

goal of ERM is not to eliminate risk, rather it is to identify, assess

and monitor the management of risks with a view to minimizing

adverse outcomes and maximizing opportunities. Like any

business, TSSA is susceptible to risks that, if unmitigated, could

threaten the sustainability of the organization.

Guided by a risk framework, including annual reporting

to the Board of Directors and quarterly reporting to each

Board Committee, ERM brings a consistent approach to the

identification, assessment and control of risks to corporate

objectives by evaluating the urgency (speed of onset),

likelihood and potential impact of enterprise-wide risks. Risk

mitigation plans are developed and embedded in strategic,

business and operating plans which, when successfully

implemented, reduce residual risks to tolerable levels. Over

the past several years, efforts have focused on: compliance,

operational, technology, people and stakeholder risks.

While the Board has responsibility to oversee management’s

assessment of risk tolerance, the Audit, Finance and Risk

Committee (AFRC) has been delegated responsibility to oversee

the implementation of the ERM framework, management’s

ongoing assessment, and monitoring of key risks and associated

risk mitigations.

Within TSSA’s Risk Framework, eight categories of risk have been identified, namely:

strategic risks are risks that are external to the organization and over which the

organization typically has no control. Strategic risks relate to the economic and political

environment in which the organization operates.

Compliance risks are risks that are internal to the organization. Compliance risks relate to the

legislative environment and the organization’s ability to comply with applicable acts, regulations

and legislation.

operational risks are risks that are internal to the organization and typically arise from the

operations of the business.

information system risks are risks that are internal to the organization and relate specifically

to technology tools used to support business processes.

financial risks are risks that are internal to the organization and as such are within the sphere

of influence of the organization. Financial risks typically arise from the planning, budgeting and

forecasting cycles of the organization.

people risks or human resource risks are risks that are internal to the organization and relate

specifically to employment. Examples include: availability/recruitment, skill set, retention and culture.

governance risks are internal risks that relate to the management and oversight of the organization

including compliance with internal controls.

stakeholder risks are risks that relate to the organization’s relations and reliance upon its various

stakeholders and its related obligations.


Through application of this framework, a number of priority risks are identified and assigned to various risk champions within the

organization. These risks have been mapped in terms of urgency, impact, likelihood and probability, and appropriate risk mitigation

strategies developed to manage risks to within established risk tolerance levels reviewed on a regular basis with AFRC.

TSSA continuously benchmarks and improves its enterprise risk management system and processes, and will continue to improve the

way in which it uses such information to make informed, strategic decisions. Through this continuous cycle of assessing and monitoring

all enterprise risks, management ensures the objectives of the organization are achieved through appropriate risk mitigation.

FinAnciAL highLightS

The following charts summarize TSSA’s revenues and expenses for the fiscal year ended April 30, 2014 with comparisons to the

annual budget and prior year. At $68.7 million, TSSA’s revenues were ahead of budget expectations by 6% and ahead of prior year by

15%. TSSA’s revenue mix comprises of Inspection ($38.3 million), Engineering ($8.3 million), Licensing/Registrations/Certifications &

Exams ($21.4 million) and Investment income ($0.7 million). Inspection revenues represent 56% of total revenue (51% prior year),

representing the single largest source of revenue. By program area, the following revenue performance was achieved this fiscal year:

TECHNICAL STANDARDS AND SAFETY AUTHORITY rEVEnUE (IN THOUSANDS)

0 5,000 10,000 15,000 20,000 25,000 30,000


Fuels Safety

Boilers and Pressure Vessels/Operating Engineers


Non-Regulatory Business

2014 Actual 2014 Budget 2013 Actual

22,475

22,223

20,313

22,228

19,719

13,622

12,752

13,049

3,697

3,725

3,484

3,236

3,320

3,422

25,911

Effective May 1, 2013, TSSA implemented changes to the existing fees across most program areas. With the exception of the

elevating and amusement device sectors, each program area achieved total revenues consistent with budget expectations. The ED/

AD Safety Program, however, generated revenues exceeding budget and prior year by 15% and 27%, respectively. Revenue growth

for ED/AD was concentrated within inspection, largely the result of the new fee model. Higher revenue, most notably from follow-up

inspections and revenue from non-compliances, attract higher, more punitive fees with a goal of influencing improved compliance.

TSSA’s budget underestimated volume/inspection mix assumptions and average rate per non-compliant inspection, resulting in

approximately $3.9 million additional revenues. While too early to conclude, management is reviewing fees associated with elevator

compliance to determine if future improvements in compliance will be realized.

The Fuels Safety Program generated revenues equal to budget and ahead of prior year by 11%. Similar to ED/AD, punitive fees are used

to influence desired safety behaviour. With the May 1, 2013 fee increases, punitive fees associated with pipeline strikes were increased,

and a new fee was also introduced related to the absence of locate markings required in advance of an excavation. These fees

contributed to the growth in revenues compared to prior year. This fiscal year also included a special non-recurring adjustment, which

affected operating and deferred revenues. Recognizing that a number of operators, particularly northern operators, had previously paid

for inspection services over a number of years without receiving the service, a refund totalling $0.7 million was issued resulting in part,

to a reduction to revenues ($0.4 million) in the current fiscal year, and an adjustment to deferred revenues ($0.3 million).

The BPV/OE Safety Program exceeded budgeted expectations and prior fiscal year revenues by 5% and 4%, respectively. The

May 1, 2013 fee increase was implemented across both program areas. All periodic inspections were completed as planned.

The USA Safety Program also generated revenues in line with budget expectations and a reasonable growth over prior year.

TSSA remains committed to providing customer value, while closely monitoring all expenses and seeking continued cost efficiencies.

Management continued with diligent cost management, and for the fiscal year ended April 30, 2014, total expenses were $65.5

million, representing a 3% unfavourable variance to budget and growth over prior year by 12%. These expenses also included an

acceleration of certain non-cash amortization expenses associated with TSSA’s business system. Excluding the one-time, non-recurring

impact of this expense, operating expenses were about equal to budget and higher than prior year by 8%.

TECHNICAL STANDARDS AND SAFETY AUTHORITY EXPEnSES (IN THOUSANDS)

10,000 20,000 30,000 40,000 50,000

Salaries, wages and benefits

Operating

Amortization*

Non-regulatorybusiness expenses

2014 Actual 2014 Budget 2013 Actual

* FY2014 Actual includes accelerated amortization

40,666

41,885

38,942

18,081

16,822

15,077

4,268

1,940

1,961

2,441

2,622

2,481


Unlike past years, most of the growth in operating expenses

was non-staff related in nature. Excluding amortization

expense, the growth in operating costs to prior year was $4.7

million, of which $3 million was related to non-compensation

expense. The single largest increase in other operating costs

was tied to TSSA’s research and education programs which

grew this fiscal year by approximately $1.1 million. These

safety programs reach out to a large number of Ontarians

and TSSA customers, using a combination of direct mail, focus

groups and select safety events to better understand safety

behaviour, and more importantly to influence Ontarians of all

ages to engage in safe activities.

In addition, TSSA has invested in various technology initiatives

to maintain and enhance the technology infrastructure

necessary to support a distributed workforce across Ontario.

Rather than increased staff complement, TSSA leveraged

key service partners, mainly in technology areas, to assist in

various data related initiatives and to complete key technology

programs. Other spending increases include increased travel

related to the above-mentioned operational programs, higher

fleet related costs to renew/brand TSSA’s commercial fleet of

vehicles, administrative costs, oversight fees and new innovative

investments in enterprise content management and learning

management systems. In all cases, management maintained

and respected budget commitments, and approached

new investments with sound business cases and project

management principles.

TSSA generated a net margin surplus of $3.2 million or 4.7%

revenues, a $1.7 million improvement over prior year’s net

margin of $1.5 million, representing solid financial performance.

This improvement, compared to prior year, reflected an increase

in revenues of $8.7 million, offset by increased operating

expenses of $4.7 million and accelerated amortization of

$2.1 million. The above return on revenue is consistent with the

guidelines contained in TSSA’s Memorandum of Understanding

with the Ontario government, and is necessary to ensure future

investment in safety programs for the province of Ontario.

cAPitAL EXPEnDitUrES

Capital expenditures of $3.1 million were incurred during fiscal

year 2013/2014 and related to investment in TSSA’s technology,

including the completion of a new field inspection interface that

will improve data entry (reduced potential for error), standardize

inspection orders and enhance general inspection administrative

efficiencies. Other technology expenditures were in hardware

and operating software as TSSA’s information services team

prepare for future enabling technologies in alignment with

business strategy.

Management continues to ensure all capital investments fully

support value to stakeholders and reflect the strategic objectives

of the organization.

nEt ASSEtS

With net assets of $22.9 million, TSSA’s financial position

remains strong. TSSA continues to operate with no funded

liabilities and maintains a solid working capital position

(excluding deferred revenue) of $10.0 million ($9.5 million

fiscal year 2012/2013). Working capital also improved by $0.5

million compared to prior fiscal year. While there has been an

increase in Accounts Receivable as at April 30, 2014, overall

financings have more than offset this increase yielding a net

working capital improvement. At April 30, 2014, TSSA’s current

ratio (excluding deferred revenue) was a multiple of 1.9:1, an

overall healthy liquidity position. TSSA’s investment in short

and long-term financial instruments, totalling $31.4 million

($26.6 million fiscal year 2012/2013), are high-quality, low-risk

financial instruments which adhere to the investment policy as

approved by the Board of Directors. Foreign currency exposure

within these investments continues to be avoided, as was any

direct investment involving sovereign risks and derivatives.

At April 30, 2014, TSSA’s total reserve was $16.9 million or

26% of total operating expenses. Within the total reserve, the

restricted reserve of $14.6 million represents 22% of total

operating expenses, which remains just below the newly

revised 25% reserve target required by policy as approved

by TSSA’s Board of Directors. The balance of the unrestricted

reserve is available to management for future approved capital

initiatives. Management regularly assesses TSSA reserves to

ensure adequate capital exists to absorb future unforeseen

economic shocks and that sufficient capital is maintained to fund

further enhancements to the safety system for the benefit of

all Ontarians.

fisCal year 2014/2015 outlook

In fiscal year 2014/2015, we will continue to build momentum,

strengthening the safety system and assisting both the public

and industry, through our roles as an advocate and a regulator,

consistent with our purpose to both enforce and promote

public safety.

As always, we measure our performance against our objectives.

With enhanced safety compliance and robust performance

measurements, we will assess achievement of our goals for

greater safety results, enhance strategic efforts for a direct

impact on safety, and effectively allocate safety resources

within inspection and engineering.

To make Ontario safer, we will continue to pursue four safety-

focused strategies:

Compliance first – through enforcement, effective incentives,

and code development:

■■ achieve and sustain elimination of all backlogs in follow-up

inspections of non-compliances;

■■ design an enhanced fee framework using incentives to

positively influence compliance; and

■■ launch an advocacy initiative to enhance understanding and

awareness of safety regulations and its benefits to industry.

leverage risk knowledge – through an understanding of risk

and the most effective means of managing that risk:

■■ review all key business processes through a comprehensive

examination of enterprise information architecture,

supporting further development of RBS2.0 as well as

additional IT benefits;

■■ continue to effectively manage potential safety risks

associated with aging devices through proven risk-informed

methods; and

■■ gain further recognition of RIDM as an innovative

regulatory approach.

shared responsibility for safety – through user behaviour

modification and effective and viable safety partnerships:

■■ leverage partnerships to increase awareness of carbon

monoxide risks and reduce incidents; and

■■ work collaboratively with MCS to enhance regulatory

compliance in the BPV sector.

organizational effectiveness – through effective resource

allocation, technological efficiency and employee engagement:

■■ invest in our employees by developing a virtual training

centre of excellence and through enhanced learning

management systems;

■■ embrace innovation to address new safety challenges and

generate improved operational efficiencies – with a pilot for

the 2015 Pan-American games; and

■■ continue to incorporate project management excellence to

effectively meet intended goals in an efficient manner.

We want to know the impact of our safety efforts on Ontario

citizens. In fiscal year 2014/2015, we will continue our use

of innovative safety metrics to measure improvements in the

reduction of risks associated with injury or fatality. This will

further enable us to quantitatively measure and externally

benchmark the health impacts associated with the sectors we

regulate, and focus our resources on those areas that have the

greatest potential to have positive impacts on public health.

Additionally, we will measure our progress toward achieving our

vision, over the course of our five-year strategic plan period, by

accomplishing the following goals:

■■ Our safety performance will indicate positive safety trends

consistent with our compliance goals.

■■ Our safety performance metrics will be recognized by

Canadian regulators as the benchmarks to measure safety.

■■ Our employees will be highly engaged, empowered, and

proud of what TSSA stands for.

■■ Our regulated customers will believe that we deliver high

value by promoting and enforcing public safety.


We enter fiscal year 2014/2015 in a strong financial position,

and we will remain focused on customer value for money and

prudent cost management practices. Total operating expenses

are expected to grow by 3%; however, after adjusting for non-

recurring amortization expenses, the rate of expense growth is

approximately 6%. The rate of planned discretionary expense

growth for the fiscal year was held equal to the prior year in

recognition of a benign inflationary environment. Additional

expenses are primarily employee related, recognizing the

full-year impact of new hires in fiscal year 2013/2014. New

technology/application development for business systems

are not expected for fiscal year 2014/2015 while the

organization pauses to complete a comprehensive review of

all key business processes, and future technology platforms.

Some expense growth is expected in employee development

initiatives, commercial fleet, corporate social responsibility,

and oversight fees

We have been tracking customers’ perceptions of the

organization’s value since 2006. As with each survey, the broad

objective of the research is to determine the key dimensions

of value customers perceive in TSSA beyond a simple value-

for-fees proposition for the purposes of strengthening customer

relationships and sharpening the value of the service it provides.

Fiscal year 2014/2015 represents the first year in which TSSA

will use a new customer value metric that can demonstrate and

measure increased customer service.

Recognizing that our employees are the drivers of all of our

successes, we will continue our efforts to ensure a positive

and collaborative work environment for our team members.

Through our exceptional team of safety professionals, working

in partnership with industry and the government of Ontario,

we will continue along our evolutionary path toward more

preventative-based activities and deliver on our purpose to both

promote and enforce public safety.

With the fiscal year 2013/2014 just completed, TSSA has

generated positive financial results over the last four fiscal years

through a continued focus on its safety mandate and prudent

cost management. TSSA’s primary goals remain focused on

safety supported through enhancements of internal controls

which yield sustainable and positive financial performance and

standardized operating procedures. TSSA remains committed

to ensuring it has the capital and reserves to secure funding

available for these initiatives and the ability to absorb any

unforeseen adverse events.

While the economic landscape has improved from prior

years, there also remain some key global and domestic

economic uncertainties that may impact the Canadian

economic landscape. Management remains watchful of the

external environment, business strategy and its annual budget

commitments. TSSA’s fiscal year 2014/2015 budget reflects a

continuation of the strategic priorities as reported in its Strategic

and Business Plans.

For the fiscal year 2014/2015 budget, management projects

total revenue of $70.2 million, growing approximately 2% over

prior fiscal year, attributable to the following factors:

■■ staffing commitments across all program areas maintained

at fiscal year 2013/2014 levels; and

■■ no new fees or changes to the fee schedule, except those

previously approved for the BPV sector.

Total operating expenses of $67.5 million, excluding the

one-time expenses associated with accelerated amortization,

are also projected to grow by just under 6% over fiscal year

2013/2014 attributable to the following factors:

■■ normal market and performance based rate adjustments for

existing employees;

■■ expense control over all discretionary expenditures;

■■ incremental investment to modernize TSSA’s database and

supporting information systems planning;

■■ modest investment in emerging corporate social responsibility

initiatives; and

■■ additional cost recovery on behalf of MCS associated with

regulatory oversight.

Since the global recession of 2008/2009, management has

focused its efforts on a continued strengthening of the financial

health and balance sheet of the organization, as is evidenced

by TSSA’s continued strong financial performance and flexibility.

Further evidence of this financial stability was attributable to

the incremental spend on enhancing the safety infrastructure

during fiscal year 2013/2014. This has allowed management to

focus on operational priorities, including addressing data issues

and other workflow/process improvements, while continuing

to invest for the future. Investments and rebalancing of other

operational programs in this budget will ultimately contribute to

positive long-term sustainability.

As stated above, forward-looking statements, such as those in

this section, are based on assumptions and predictions, and, as

such, are inherently subject to uncertainty.

2014 Actual 2015 Budget

0 5,000 10,000 15,000 20,000 25,000 30,000


Fuels Safety

Boilers and Pressure Vessels/ Operating Engineers


Non-Regulatory Business

2014 Actual 2015 Budget

26,087

22,223

23,247

13,622

14,367

3,697

3,686

3,236

2,803

25,911

0 10,000 20,000 30,000 40,000 50,000

Salaries, wages and benefits

Operating

Amortization

40,666

43,547

18,081

19,380

4,268

2,756

Non-regulatorybusiness expenses

2,441

1,722

The chart below provides a snapshot of the fiscal year 2014/2015 budget commitment.

TECHNICAL STANDARDS AND SAFETY AUTHORITY TECHNICAL STANDARDS AND SAFETY AUTHORITY rEVEnUE (IN THOUSANDS) EXPEnSES (IN THOUSANDS)


Technical Standards and Safety Authority

(Incorporated under the laws of Ontario)

StAtEmEnt OF FinAnciAL POSitiOn(In thousands of dollars)

April 30, 2014, with comparative information for 2013

2014 2013

ASSEtS

Current assets:

Cash $ 1,948 $ 1,716

Short-term investments (note 2) 12,259 10,858

Accounts receivable (note 3) 7,168 6,246

Prepaid expenses 318 984

21,693 19,804

Long-term investments (note 2) 19,155 15,788

Capital assets (note 4) 5,966 7,141

$ 46,814 $ 42,733

LiABiLitiES AnD nEt ASSEtS

Current liabilities:

Accounts payable and accrued liabilities (note 5) $ 11,673 $ 10,329

Deferred revenue 12,280 12,776

23,953 23,105

Net assets:

Invested in capital assets 5,966 7,141

Restricted reserve (note 10) 14,625 8,938

Unrestricted reserve (note 10) 2,270 3,549

22,861 19,628

Commitments and contingencies (note 12)

$ 46,814 $ 42,733

See accompanying notes to financial statements.

On behalf of the Board:

_____________________________ __________________________________

Judith Wolfson David Hipgrave

Chair of the Board of Directors Chair of Audit, Finance and Risk Committee

independent auditors’ report

To the Members of Technical Standards and Safety Authority

We have audited the accompanying financial statements of Technical Standards and Safety Authority, which comprise the statement

of financial position as at April 30, 2014, the statements of operations, changes in net assets and cash flows for the year then ended,

and notes, comprising a summary of significant accounting policies and other explanatory information.

management’s responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian

accounting standards for not-for-profit organizations, and for such internal control as management determines is necessary to enable

the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance

with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan

and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.

The procedures selected depend on our judgment, including the assessment of the risks of material misstatement of the financial

statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s

preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the

circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also

includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by

management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position of Technical Standards and Safety

Authority as at April 30, 2014, and its results of operations and its cash flows for the year then ended in accordance with Canadian

accounting standards for not-for-profit organizations.

Chartered Professional Accountants, Licensed Public Accountants

June 22, 2014

Toronto, Canada



StAtEmEnt OF OPErAtiOnS(In thousands of dollars)

Year ended April 30, 2014, with comparative information for 2013

2014 2013

Regulatory business revenue:

Elevating and amusement devices $ 25,911 $ 20,313

Fuels 22,223 19,719

Boilers and pressure vessels and operating engineers 13,622 13,049

Upholstered and stuffed articles 3,697 3,484

65,453 56,565

Non-regulatory business revenue 3,236 3,422

68,689 59,987

Regulatory business expenses:

Salaries, wages and benefits 40,666 38,942

Operating 18,081 15,077

Amortization 4,268 1,961

63,015 55,980

Non-regulatory business expenses 2,441 2,481

65,456 58,461

Excess of revenue over expenses $ 3,233 $ 1,526



StAtEmEnt OF chAngES in nEt ASSEtS(In thousands of dollars)


2014 2013

Invested in capital Restricted Unrestricted assets reserve reserve Total Total (note 10)

Net assets, beginning of year $ 7,141 $ 8,938 $ 3,549 $ 19,628 $ 18,102

Excess (deficiency) of revenue

over expenses (4,268) – 7,501 3,233 1,526

Investment in capital assets 3,093 – (3,093) – –

Interfund transfer (note 10) – 5,687 (5,687) – –

Net assets, end of year $ 5,966 $ 14,625 $ 2,270 $ 22,861 $ 19,628




StAtEmEnt OF cASh FLOwS(In thousands of dollars)


2014 2013

Cash provided by (used in):

Operating activities:

Excess of revenue over expenses $ 3,233 $ 1,526

Items not involving cash:

Amortization 4,268 1,961

Unrealized loss (gain) on short-term investments 41 (166)

Unrealized gain on long-term investments (130) (70)

Change in non-cash operating working capital 592 52

8,004 3,303

Investing activities:

Proceeds on maturity of short-term investments 6,018 2,986

Purchase of short-term investments (7,460) (1,579)

Proceeds on maturity of long-term investments 4,632 7,858

Purchase of long-term investments (7,869) (10,029)

Acquisition of capital assets (3,093) (2,265)

(7,772) (3,029)

Increase in cash 232 274

Cash, beginning of year 1,716 1,442

Cash, end of year $ 1,948 $ 1,716



notes to finanCial statements

Technical Standards and Safety Authority (“TSSA”) is a statutory corporation without share capital under the Technical Standards and

Safety Act, 2000 (the “TSS Act”), based on amendments that were proclaimed effective May 1, 2010. TSSA is responsible for the

administration of the TSS Act. As required by the amendments, TSSA entered into a Memorandum of Understanding (“MOU”) with

the Ministry of Consumer Services of the Province of Ontario. Effective April 24, 2013, and pursuant to the TSS Act, the Ministry of

Consumer Services of the Province of Ontario and TSSA executed an amendment to the MOU to revoke and replace the prior additional

non-regulatory objects of the TSSA, including certain procedures to facilitate compliance with the revised requirements. These

revised objects reflect more clearly the non-regulatory business activities of the TSSA.

TSSA’s objectives, as outlined in the TSS Act and MOU, allow TSSA to continue to administer the TSS Act and its regulations to promote

and undertake public safety activities in relation to matters assigned to it, including training, certification, licensing, registration, audit,

quality assurance, inspection, investigation and enforcement, subject to certain additional powers of the Ministry of Consumer Services

of the Province of Ontario. TSSA is a non-profit organization under the Income Tax Act (Canada) and is exempt from income tax.

Regulatory business revenue (formerly known as mandated revenue) reflects those activities prescribed under the TSS Act.

In addition to its regulatory business services, TSSA offers services to the federal government and undertakes other contracts that are

not regulated, as permitted by the TSS Act and MOU. This revenue is categorized as non-regulatory business revenue (formerly known

as discretionary revenue).

1. significant accounting policies:

The financial statements are prepared by management in accordance with Canadian Accounting Standards for Not-For-Profit

Organizations in Part III of the Chartered Professional Accountants of Canada Handbook - Accounting.

(a) Revenue recognition:

Revenue from the provision of inspection and engineering services is recorded when services are performed. Licensing,

registration and certification fees are recognized as deferred revenue when received. These fees are then recognized

evenly over the period covered by the fee.

Interest income is recognized as revenue when earned and is recorded on the accrual basis.

(b) Financial instruments:

Financial instruments are recorded at fair value on initial recognition. Equity instruments that are quoted in an active

market are subsequently measured at fair value. All other financial instruments are subsequently recorded at cost or

amortized at cost, unless management has elected to carry the instruments at fair value. TSSA has not elected to carry

any such financial instruments at fair value.

Transaction costs incurred on the acquisition of financial instruments measured subsequently at fair value are expensed

as incurred. All other financial instruments are adjusted by transaction costs incurred on acquisition and financing costs,

which are amortized using the effective interest rate method.

Financial assets are assessed for impairment on an annual basis at the end of the fiscal year if there are indicators

of impairment. If there is an indicator of impairment, TSSA determines if there is a significant adverse change in the


expected amount or timing of future cash flows from the financial asset. If there is a significant adverse change in

the expected cash flows, the carrying value of the financial asset is reduced to the highest of the present value of the

expected cash flows, the amount that could be realized from selling the financial asset or the amount TSSA expects to

realize by exercising its right to any collateral. If events and circumstances reverse in a future period, an impairment loss

will be reversed to the extent of the improvement, not exceeding the initial carrying value.

(c) Accounts receivable:

Accounts receivable are measured at fair value on origination.

At year end, TSSA assesses whether there are any indications that the carrying value of the receivables may be impaired.

For purposes of impairment testing, each significant account is assessed individually; the balance of the accounts are

grouped on the basis of similar credit risk characteristics. When there is an indication of impairment, TSSA determines

whether there has been a significant adverse change in the expected timing or amount of future cash flows. When TSSA

identifies a significant adverse change, it reduces the carrying amount of the receivable to the higher of the amount that

could be realized by selling the receivable at the statement of financial position date and the present value of the cash

flows expected to be generated by holding the receivable.

When the extent of impairment of a previously written down receivable decreases and the decrease can be related to an

event occurring after the impairment was recognized, the impairment loss is reversed to the extent of the improvement.

(d) Capital assets:

Purchased capital assets are recorded at cost less accumulated amortization. Leases that transfer substantially all the

benefits and risks of ownership are capitalized. Replacements are expensed in the year of replacement. Amortization is

provided on a straight-line basis over the estimated useful lives of the assets at the following annual rates:

Business systems 20%

Equipment 25%

Furniture and fixtures 20%

Computer software 50%

Computer hardware 33%

Leasehold improvements Remaining term of lease

Amortization of a capital asset commences when it is brought into service.

Contributed capital assets are recorded at fair value at the date of contribution.

Assets attributable to capital projects that are not available for use are held as construction in progress and are not

amortized until they are available for use.

A change in accounting estimate during the year was applied prospectively. The change in accounting estimate

was based on management’s assessment of the useful life of business systems and resulted in an increase of the

amortization expense in 2014 of $2,055.

(e) Foreign currency translation:

Monetary assets and liabilities denominated in foreign currencies are translated into Canadian dollars at the prevailing

rates of exchange at the year-end date. Revenue and expenses are translated at the exchange rates prevailing on the

transaction date. Realized and unrealized exchange gains and losses are included in the statement of operations.

Realized foreign exchange gain (loss) of $51 (2013 - $(12)) is included in operating expenses.

(f) Allocation of expenses:

TSSA classifies expenses on the statement of operations by business type, regulatory business and non-regulatory

business. TSSA allocates certain expenses as noted below on a consistent basis each year. Allocated expenses and the

basis of allocations are as follows:

(i) Direct labour and benefits are allocated on the basis of time incurred as a percentage of revenue; and

(ii) Certain corporate support expenses are allocated using various allocation methods, including percentage of revenue

and square footage of space.

(g) Use of estimates:

The preparation of financial statements requires management to make estimates and assumptions that affect the

reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial

statements and the reported amounts of revenue and expenses during the year. Actual results could differ from

those estimates.

2. investments:

(a) Short-term investments consist of cash, bankers’ acceptances, guaranteed investment certificates and bonds, with yields

between 1.17% and 4.97% (2013 - 1.05% and 5.25%), maturing prior to April 29, 2015 (2013 - April 23, 2014).

(b) Long-term investments consist of the following:

2014 2013 Market Market Cost value Cost value

Corporate and

government bonds $ 18,977 $ 19,155 $ 15,740 $ 15,788

The long-term investments have effective rates between 1.00% and 2.50% (2013 - 1.00% to 4.97%), maturing from

June 2015 to June 2019 (2013 - May 2014 to October 2017).

TSSA holds fixed income securities which are subject to market risk, interest risk and cash flow risk. These risks will also

impact future cash flow streams, including dividends, gains and losses and interest income.

The value of fixed income securities will generally rise if interest rates fall and fall if interest rates rise. Changes in interest

rates may also affect the value of equity securities.

The value of securities denominated in a currency other than the Canadian dollar will be affected by changes in the

value of the Canadian dollar in relation to the value of the currency in which the security is denominated.

TSSA does not enter into any derivative instruments arrangements for hedging or speculative purposes.

3. accounts receivable:

2014 2013

Accounts receivable $ 7,752 $ 6,670

Less allowance for doubtful accounts 584 424

$ 7,168 $ 6,246


4. Capital assets:

2014 2013

Accumulated Net book Net book Cost amortization value value

Business systems $ 10,446 $ 6,336 $ 4,110 $ 5,889

Equipment 1,061 1,035 26 54

Furniture and fixtures 1,518 1,509 9 15

Computer software 1,613 1,255 358 179

Computer hardware 4,473 3,459 1,014 345

Leasehold improvements 2,047 1,598 449 659

$ 21,158 $ 15,192 $ 5,966 $ 7,141

5. accounts payable and accrued liabilities:

Included in accounts payable and accrued liabilities are government remittances payable of $1,144 (2013 - $1,036), which relate

to sales tax, payroll remittances and oversight fees charged by the Ministry of Consumer Services of the Province of Ontario.

6. allocation of expenses:

Direct labour and benefits expenses of $1,139 (2013 - $1,178) have been allocated to non-regulatory business expenses.

Corporate support expenses of $31,199 (2013 - $26,514) have been allocated as follows:

2014 2013

Regulatory business expenses $ 30,004 $ 25,310

Non-regulatory business expenses 1,195 1,204

$ 31,199 $ 26,514

7. fair values of financial assets and financial liabilities:

The carrying values of cash, accounts receivable and accounts payable and accrued liabilities approximate their fair values due to

the relatively short term to maturity of these financial instruments.

The fair value of short-term investments and long-term investments is equal to quoted market value, as described in note 2.

8. pension plans:

TSSA has established defined contribution pension plans for its employees. Contributions by TSSA on account of current service

pension costs paid and expensed amounted to $1,759 (2013 - $1,660).

9. indemnification of directors and officers:

TSSA has indemnified its past, present and future directors and officers against expenses (including legal expenses), judgments

and any amount actually or reasonably incurred by them in connection with any action, suit or proceeding in which the directors

and officers are sued as a result of their service, if they acted honestly and in good faith with a view to the best interest of TSSA.

The nature of the indemnity prevents TSSA from reasonably estimating the maximum exposure. TSSA has purchased directors’

and officers’ liability insurance with respect to this indemnification.

10. restricted reserve:

TSSA has an approved restricted reserve to ensure sufficient capital is maintained for continued services and to allow for

significant unforeseen economic events. This policy, approved by the board, requires TSSA to attain and maintain a restricted

reserve of 25% of budgeted operating expenses. The board considers the sum of the restricted reserve and unrestricted reserve

to be the total reserve. As at April 30, 2014, the total reserve was $16,895 (2013 - $12,487). The board approved a transfer,

effective April 30, 2014 from the unrestricted reserve to the restricted reserve in the amount of $5,687 (2013 - $868).

The balance of $2,270 (2013 - $3,549) in the unrestricted reserve represents funding for future business initiatives.

11. Capital disclosures:

TSSA’s capital is its net assets as reflected in the statement of financial position. Within net assets, TSSA manages its restricted

reserve and unrestricted reserve, as described fully in note 10. TSSA’s primary objective of enhancing public safety is supported

by safeguarding its assets and ensuring it remains financially viable through effective risk-based planning, investment and cost

management policies and procedures. TSSA manages its capital structure through its strategic planning process, as approved by

the board. This includes an annual budget of revenue and expenses, investments in capital assets and management of cash and

interest-bearing short-term/long-term investments. There are no externally imposed restrictions on its capital structure.

12. Commitments and contingencies:

(a) Operating facility:

Under the terms of its banking agreement, TSSA has available a demand operating facility of up to $750. This facility

bears interest at TSSA’s bank’s prime rate plus 0.25% per annum and is secured by a general security agreement over

TSSA’s assets and assignment of fire and business interruption insurance. As at April 30, 2014, nil (2013 - nil) was drawn

on the facility.

(b) Lease obligations:

TSSA leases office space, vehicles and equipment. Future minimum payments, by year and in the aggregate, under

operating leases with initial or remaining terms of one year or more, consist of the following:

2015 $ 2,033

2016 1,435

2017 249

2018 83

2019 6

Total minimum lease payments $ 3,806

(c) Litigations:

TSSA has been named as defendant in certain litigations alleging actual and punitive damages. However, it is

management’s belief that the ultimate outcome will not materially affect TSSA’s financial position. Settlement,

if any, will be accounted for during the period of resolution.

cOrPOrAtE inFOrmAtiOn

“TSSA solicits advice and input from industry through

our advisory councils in relation to safety strategies,

initiatives and service delivery – for a broader

perspective on public safety.”


Corporate information

Providing oversight of the organization, TSSA’s Board of Directors takes a leadership role in the organization’s strategic

direction. The Board and senior management team monitor emerging governance best practices, with a view to

continuous improvement and enhancement of our governance regime.

Demonstrating clear strengths in Board and Committee charters, terms of reference and work plans, we continued

our leading practices in performance reporting, including focusing on safety activities, outcomes and results, over the

course of the year.

tSSA’S BOArD OF DirEctOrS

donald aronson

President, Aronson and Associates Inc.

lynda bowles

Former Audit Partner, Deloitte and Touche

Joanne butler

Vice-President, Electricity Resources, Ontario Power Authority

douglas harrison

President and CEO, VersaCold

david hipgrave

Former President and CEO, Society of Management

Accountants of Ontario

norm inkster, Vice Chair

Former Chief and Safety Risk Officer

susan kushneryk

Senior Enforcement Council, Investment Industry Regulatory

Organization of Canada

michael lees

former President, Babcock and Wilcox Nuclear Energy

bhupinder (lally) marwah

President, SQS Solutions

pamela nowina

Executive Lead, Mowat Energy, University of Toronto

Connie roveto

President, Cirenity Management

robbie shaw

Executive Advisor to the Dean of Management,

Dalhousie University

Judith Wolfson, Chair

Vice President, University Relations,

University of Toronto

tSSA’S BOArD cOmmittEES

Standing committees

TSSA requires all directors to be a member of one of the two

standing committees: Audit, Finance and Risk; and Governance,

Safety and Human Resources.

Audit, Finance and risk committee

The Audit, Finance and Risk Committee assists the Board of

Directors in fulfilling its responsibility for oversight of the quality

and integrity of the accounting, auditing, and reporting practices

of the organization.

The Committee’s role includes the oversight of:

■■ financial information provided to stakeholders

and the Ontario government;

■■ the organization’s processes to manage business

and financial risk;

■■ the organization’s information technology;

■■ the review and recommendation of the

organization’s budgets;

■■ compliance with applicable legal, ethical and

regulatory requirements; and

■■ the external audit firm engaged to prepare and issue an audit

report on the financial statements of the organization.

david hipgrave, Chair

lynda bowles, Member

douglas harrison, Member

norm inkster, Member

susan kushneryk, Member

pamela nowina, Member

gOVErnAncE, SAFEty AnD hUmAn rESOUrcES cOmmittEE

The Governance, Safety and Human Resources Committee

assists the Board of Directors in fulfilling its responsibilities

with respect to:

■■ Board governance, including Board ethics, performance,

succession, education and development and policies, and

Board composition and recruitment;

■■ regulatory governance, including the organization’s safety

management framework;

■■ human resources, including performance, compensation,

succession, and occupational health and safety;

■■ leadership;

■■ corporate strategy; and

■■ stakeholder relations and disclosure.

robbie shaw, Chair

donald aronson, Member

Joanne butler, Member

michael lees, Member

bhupinder (lally) marwah, Member

Connie roveto, Member

tSSA’S BOArD OF DirEctOrS – BOArD rEmUnErAtiOn

Members of the Board of Directors are remunerated in a

manner that enables the organization to: attract high calibre

directors; support the organization’s commitment to corporate

governance excellence; and remain accountable to all

stakeholders through transparent compensation practices that

are fiscally prudent. With the aid of an external consultant, the

levels of remuneration for the Board Chair, Vice Chair, committee

chairs and directors are established based on a combination of

annual retainers and meeting fees. Director total compensation

levels are triennially reviewed against industry comparators

within crown corporations, and non-government regulatory

organizations and associations. A blend of the market median

of these comparators is utilized to establish compensation levels

for retainers and meeting fees. For additional information on

Board remuneration, please visit www.tssa.org.

PAy POLicy

TSSA’s compensation philosophy is to pay a competitive

total compensation package to attract and retain exceptional

resources while remaining accountable to all stakeholders

through transparent, fiscally prudent compensation practices.

Based on yearly market data from an external consulting

firm, with a blend from public and private sectors, TSSA’s pay

policy provides base compensation at the median of market

comparators, utilizing the Greater Toronto Area for all non-

executive employees and national data for the executive group.

Earned incentive pay compensation targets are also established

at the median of market.

Annual salary reviews are conducted and, at the discretion of

the organization and within the overall budget approved by

the Board, increases are administered on a merit basis with

consideration to internal equity, external competitiveness

(market data) and individual performance. In addition, TSSA

adheres to the requirements of the Pay Equity Act. Reinforcing

a performance culture and providing compensation that is

competitive and appropriate for the organization, employees

must meet basic performance criteria in order to be eligible

for incentive pay. Incentive pay is awarded on exceeding key

performance objectives.


SEniOr mAnAgEmEnt tEAm

tom ayres

Vice President and General Counsel

michael beard

President and CEO

brenda buchanan

Vice President, Human Resources and Training

Wilson lee

Director, Stakeholder Relations

robert pope

Chief Information Officer

david scriven

Vice President, Research and Corporate Secretary

richard smart

Chief Financial Officer

peter Wong

Vice President, Operations

tSSA’S StAtUtOry APPOintmEntS

The individuals listed below are designated as Director or Chief

Officer under Ontario’s Technical Standards and Safety Act, 2000

and/or specific regulations.

roland hadaller, P.Eng.

Director

Technical Standards and Safety Act, 2000

Amusement Devices, Ontario Regulation 221/01

Certification and Training of Amusement Device Mechanics,

Ontario Regulation 187/03

Elevating Devices, Ontario Regulation 209/01

Certification and Training of Elevating Device Mechanics,


John marshall, BA, CIGC

Director


Compressed Natural Gas, Ontario Regulation 214/01

Fuel Oil, Ontario Regulation 213/01

Gaseous Fuels, Ontario Regulation 212/01

Liquid Fuels, Ontario Regulation 217/01

Oil and Gas Pipeline Systems, Ontario Regulation 210/01

Propane Storage and Handling, Ontario Regulation 211/01

Fuel Industry Certificates, Ontario Regulation 215/01

Certification of Petroleum Equipment Mechanics,


mike adams, M.Eng., P.Eng., PMP

Director and Chief Officer


Director

Boilers and Pressure Vessels, Ontario Regulation 220/01

John W.b. Coulter, C.E.T., TECH C.E.I.

Chief Officer

Operating Engineers, Ontario Regulation 219/01

dara Vorkapic

Director


Upholstered and Stuffed Articles, Ontario Regulation 218/01

inDUStry ADViSOry cOUnciLS

TSSA actively solicits the advice and input of key stakeholders

from the respective industries that it regulates through nine

industry specific advisory councils. The advisory councils provide

a forum to enable TSSA to obtain advice and input in relation

to safety strategies, initiatives and service delivery within their

respective industry sectors. These councils and their chairs are

listed below.

Virginia ludy

Amusement Devices

peter harschnitz

Boilers and Pressure Vessels

kelly leitch

Elevating Devices

bob smith

Liquid Fuels

michael shannon

Natural Gas

Colin andrews

Operating Engineers

david karn

Propane

bruce haynes

Ski Lift

lloyd hall


cOnSUmErS ADViSOry cOUnciL

The Consumers Advisory Council’s mandate is to provide

observations, identify gaps and recommend opportunities

for improvement with respect to TSSA’s services, policies and

actions as they affect the public. We additionally advocate for

the public interest and for public input in safety matters in areas

regulated by TSSA. During the fiscal year, this council addressed

the following priority safety issues: enhancing consumer

engagement through best practice guidelines, student award

programs to elevate safety issues, and continued discussions

with the Electrical Safety Authority, Canadian Standards

Association (CSA), and Consumers Council of Canada; gained

further clarity on vulnerable consumers through CSA and an

International Standards Association paper; and serving on MCS

consultations for the propane review, the home inspection

expert panel, and CSA’s national standard of practice for home

inspectors. Members continue their involvement in other TSSA-

related activities by providing consumer perspectives to the

industry advisory councils’ deliberations.

The Safety Education Graduate Scholarship program is supported

by TSSA’s safety education fund, established in 1998. It is

historically funded from: compliance payments such as court

authorized settlement; contributions (matched by TSSA)

from Consumers Advisory Council members and others; and

contributions by TSSA based on Consumers Advisory Council

attendance. The Consumers Advisory Council has oversight

responsibility for the fund and the scholarship is now in its

eighth year. The Council reviews successful applicants for

an award of $15,000 per annum up to a maximum of two

years for Master’s students and three years for PhD students.

In addition, the Council continues to provide scholarships of

$1,000 to finalists in six categories of the Ontario Technological

Skills Competition.

Members of the Council are listed below.

patricia Jensen, Chair

robert brady, Member

dolly gerrior, Member

brian horsman, Member

Jane mcCarthy, Member

elizabeth nielsen, Member

matilda presner, Member

kathryn Woodcock, Member

matthew ying, Member

More information regarding the advisory councils, including

minutes of meetings, can be accessed through TSSA’s website

at www.tssa.org.


Company balanCed sCoreCard for fisCal year 2013/2014(yEAr-EnD rESULtS At APriL 30, 2014)

OBjEctiVE mEASUrE FiScAL yEAr 2012/2013 PErFOrmAncE FiScAL yEAr 2013/2014 tArgEt yEAr-EnD StAtUS cOmmEntS

SAFEty OUtcOmES

Reduced health impacts Risk of Injury or Fatality7.8 per cent reduction of risk of Injury or Fatality compared to

previous year (baseline)

A reduction from previous year toward the

strategic plan target for 2016/2017 of a 10%

reduction from baseline (2011/2012)

3.0 per cent decrease in risk of Injury

or Fatality compared to baseline1Target achieved

Increased regulatory

compliance

Periodic inspections/audits

with no non-compliances

identified2

fuels Equal to or better than previous fiscal year3

Contractors audits 57% 55%

Target not met; TSSA will conduct

an analysis

Licensed sites 49% 53% Increase of 4%

elevating and amusement devices Equal to or better than previous fiscal year

Elevating Devices 32% 31%

Target not met; TSSA will conduct

an analysis

Amusement Devices 58% 63% Increase of 5%

boilers and pressure Vessels and operating engineers Equal to or better than previous fiscal year

Boilers and Pressure Vessels 97% 97% No change

Operating Engineers 40% 41% Increase of 1%

1 For further information on this metric and its baseline target, please see TSSA’s annual public safety performance report.

2 The median value of periodic inspections/audits with no non-compliances identified over a five-year rolling time period. Compliance indicators and associated results ending Fiscal Year 2012/2013 have been aligned with the ASPR and quarterly reporting. The higher the number, the better the compliance.

3 Results may be impacted by mandated enforcement initiatives to address identified compliance concerns. These initiatives are described in TSSA’s annual public safety performance reports.


OBjEctiVE mEASUrE FiScAL yEAr 2012/2013 PErFOrmAncE FiScAL yEAr 2013/2014 tArgEt yEAr-EnD StAtUS cOmmEntS

OrgAnizAtiOnAL EFFEctiVEnESS

Enhanced Efficiency Operating Leverage4 1.6% Positive leverage 2.4% Target achieved

Accuracy and

completeness of incident

data used for public safety

decision-making and

performance reporting

Data error rateIncident data accuracy and completeness verified through

independent audit

90% confident that error rate is less than or

equal to 10%

Specific procedures review conducted

by Grant Thornton LLP, states that

audit objective was achieved

Target achieved

Enhanced customer valuePerformance index score

from customer value survey 172

An improvement from previous year toward the

strategic plan target for 2016/2017 of 205173 Target achieved

Enhanced employee

engagement5

Employee survey

engagement scoreFiscal year 2011/2012 results were 64% 67% overall engagement 62% overall engagement

Target not met; Action Plan

being delivered

Employee health

and safety

Occupational health and

safety dashboard leading

indicators (training, quality

audits completed and

average quality audit score)

Green on all indicators Green on all leading indicators Green on all leading indicators Target achieved

FinAnciAL PErFOrmAncE

Total revenue Annual $ $59.99 million $64.50 million $68.689 million

Annual revenue exceeded

current year target and prior year

performance.

Total net margin Annual $ $1.53 million $1.23 million $3.234 million

Year-end net margin exceeds target

and prior year performance on

strength of revenues.

4 The percentage of revenue growth less the percentage expense growth arising from normal operations exclusive of planned strategic investments approved by the Board over a five-year period.

5 Employee engagement surveys are conducted approximately every 18 months.

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TSSA’s Annual Public Safety Performance Report provides comprehensive

information on the state of compliance as well as measures and trends on

the safety performance of the sectors it regulates. Download your copy at

www.tssa.org/regulated/about/publicsafetyreports.aspx

Technical Standards and Safety Authority 2013-14 A

nnual Report Our Stories in Safety

2013-14

Annual ReportTechnical Standards and Safety Authority

OuR STORieS in SAfeTy

Technical Standards and Safety Authority 3300 Bloor Street West

14th floor, Centre TowerToronto, Ontario Canada M8X 2X4

Tel: 416-734-3300fax: 416-231-1626

Toll free: 1-877-682-8772 (TSSA)e-mail: [email protected]

www.tssa.org

annual report - tssa€¦ · 2013-14 annual report our stories in safety 2013-14 annual report...

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